Tax on Canadian consultant

[cstreit]

Hey guys,

Ever hired a consultant or developer from Canada?

I've got a relationship with a guy who I would like to pay for some development work but he's in Canada. With a US subcontractor we know how to handle the tax regulations. However I'm not sure where to start looking WRT forms and reporting for paying fees to a person in Canada.

Any ideas? Experience a plus!

[911Rob]

I haven't done any out of Country consulting (to date), but I'm sure you'd be exempt from "our" Federal and Provincial taxes. As for income tax, if he's a consultant that could be deemed an employee, you may be required to holdback a remittance to your State? That can be easily checked by you by calling your local remittance office.

You might want to consider paying him in Canadian dollars too?

I did have an income source from an American company once and they did not pay any of our Provincial or Federal taxes.

Cheers,

[Cdnone1]

If he use to be in politics he doesn't have to pay taxes.
Sorry about that

Steve

[GWN7]

Having worked for several US companys I can say it is a simple process. As he is working in another country you don't withold any taxes, ect (he pays taxes based on where he lives). You do have to file a employee form with the US government (can't remember what it's called or it's number) and it asks for his Social Security Number. When he gives you his number and you file the form, the US government will send you a note saying not to pay him as the S.S.I. is not valid, as it will be a Canadian number. Include a note with the form stating that he lives in Canada and is a Canadian working in Canada for your company and that should solve that problem. Consultant or commissioned sales, all works the same.